The question is how could banks not know of these dodgy transactions or did they deliberately overlook them, asked one of the persons in the know.“The wider problem is that there have been significant transactions where recoverability is doubtful. The resignation in EIIL came weeks after PwC resigned as auditor of Reliance Capital and Reliance Home Finance. PwC had not gone into the specifics but hinted at certain transactions involving group companies.“The biggest issue with the earlier NPA (non-performing asset) problem was that banks ignored the early warnings and did not categorise these as one. According to a person close to the development, while in one case the same transaction has been questioned, in another, the transaction has been impaired or written off. Both the group companies are audited by different auditors.

Source: Economic Times July 03, 2019 02:48 UTC